Be prepared for furlough scheme ending
The UK Government’s Coronavirus Job Retention Scheme will close on 31 October 2020 following a series of changes to the level of support over the coming weeks.
The COVID-19 survey results published by the Scottish Charity Regulator (OSCR) in June showed that 19% of the Scottish charities who responded said they had used the scheme to support their organisation during the COVID-19 pandemic. Two thirds (66%) of charities with 11 or more employees, and half (50%) of charities with income of £100,000 or more had furloughed staff.
The ending of the furlough scheme could have serious implications, particularly for charities of this scale and their beneficiaries. Our survey found that that 42% of charities reported disruption of services to beneficiaries due to COVID-19. This was higher for charities working in housing (63%), mental health (65%) and social care (55%). It is therefore critical that affected charities fully understand the impact on their organisation and the need to be proactive in planning what this might mean for the activities and services they deliver.
Although the scheme is ending, there may be further sources of support available to charities depending on the work they do or the size of their organisation. The Scottish Council for Voluntary Organisations (SCVO) has an online coronavirus hub that contains information on dedicated funding in response to the pandemic and the Scottish Government has COVID-19 business support information on its website.
OSCR continues to work closely with key partners and stakeholders across the sector and government to try to build the best advice possible for charities at this time. Our COVID-19 guidance has essential information specifically for charities and highlights other organisations who may be able to offer support.
OSCR Chief Executive Maureen Mallon said,
‘The Coronavirus Job Retention Scheme has offered a significant level of support for many Scottish charities. It has allowed them to continue to operate and retain and support their employees during the pandemic.
‘With the scheme due to end soon, we expect this to have a significant impact, especially on those charities who are employers and who are experiencing an increase in demand at the same time as a decrease in income. It is important that charities are making the appropriate preparations in order to manage the loss of this support. This includes being transparent with beneficiaries as well as current and potential funders about any possible impact. Charities also need to consider what other steps they need to take as lockdown rules change, including considering the use of their reserves and reviewing the intended use of any designated funds that they may have.’
‘The feedback from our surveys tells us that COVID-19 has affected Scottish charities differently. Some have been unable to operate, whilst others have seen their services and programmes increasingly in demand. Whatever situation applies, it is important that trustees are taking well considered and correctly documented decisions. A failure to do this could affect confidence in charities at a time where their efforts may be required more than ever.’